Texas Statutes
Article 6243g-4. Police Officers Pension System in Certain Municipalities
Section 9E. City Contribution Rate When Estimated City Contribution Rate Equal to or Greater Than Corridor Midpoint; Authorization for Certain Adjustments

Sec. 9E. CITY CONTRIBUTION RATE WHEN ESTIMATED CITY CONTRIBUTION RATE EQUAL TO OR GREATER THAN CORRIDOR MIDPOINT; AUTHORIZATION FOR CERTAIN ADJUSTMENTS. (a) This section governs the determination of the city contribution rate in a fiscal year when the estimated city contribution rate is equal to or greater than the corridor midpoint.
(b) If the estimated city contribution rate is:
(1) less than or equal to the maximum contribution rate for the corresponding fiscal year, the estimated city contribution rate is the city contribution rate; or
(2) except as provided by Subsection (d) or (e) of this section, greater than the maximum contribution rate for the corresponding fiscal year, the city contribution rate equals the corridor midpoint achieved in accordance with Subsection (c) of this section.
(c) For purposes of Subsection (b)(2) of this section, the following adjustments shall be applied sequentially to the extent required to decrease the estimated city contribution rate to equal the corridor midpoint:
(1) first, if the payoff year of the legacy liability was accelerated under Section 9D(c) of this article, extend the payoff year of existing liability loss layers, by extending the most recent loss layers first, to a payoff year not later than 30 years from the first day of the fiscal year beginning 12 months after the date of the risk sharing valuation study in which the liability loss layer is first recognized; and
(2) second, adjust the actuarial value of assets to the current market value of assets, if making the adjustment causes the city contribution rate to decrease.
(d) If the city contribution rate after adjustment under Subsection (c) of this section is greater than the third quarter line rate:
(1) the city contribution rate equals the third quarter line rate; and
(2) to the extent necessary to comply with Subdivision (1) of this subsection, the city and the board shall enter into a written agreement under Section 27 of this article to increase member contributions and make other benefits or plan changes not otherwise prohibited by applicable federal law or regulations.
(e) If an agreement under Subsection (d)(2) of this section is not reached on or before April 30 before the first day of the next fiscal year, before the start of the next fiscal year to which the city contribution rate would apply, the board, to the extent necessary to set the city contribution rate equal to the third quarter line rate, shall:
(1) increase member contributions and decrease cost-of-living adjustments;
(2) increase the normal retirement age; or
(3) take any combination of the actions authorized under Subdivisions (1) and (2) of this subsection.
(f) If the city contribution rate remains greater than the corridor midpoint in the third fiscal year after adjustments are made in accordance with an agreement under Subsection (d)(2) of this section, in that fiscal year the city contribution rate equals the corridor midpoint achieved in accordance with Subsection (g) of this section.
(g) The city contribution rate must be set at the corridor midpoint under Subsection (f) of this section by:
(1) in the risk sharing valuation study for the third fiscal year described by Subsection (f) of this section, adjusting the actuarial value of assets to equal the current market value of assets, if making the adjustment causes the city contribution rate to decrease; and
(2) under a written agreement entered into between the city and the board under Section 27 of this article:
(A) increasing member contributions; and
(B) making any other benefits or plan changes not otherwise prohibited by applicable federal law or regulations.
(h) If an agreement under Subsection (g)(2) of this section is not reached on or before April 30 before the first day of the next fiscal year, before the start of the next fiscal year, the board, to the extent necessary to set the city contribution rate equal to the corridor midpoint, shall:
(1) increase member contributions and decrease cost-of-living adjustments;
(2) increase the normal retirement age; or
(3) take any combination of the actions authorized under Subdivisions (1) and (2) of this subsection.

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